%0 Journal Article %A Kimberly Dunn %A Siva Nathan %T Analyst Industry Diversification and Earnings Forecast Accuracy %D 2005 %R 10.3905/joi.2005.517169 %J The Journal of Investing %P 7-14 %V 14 %N 2 %X This study of the effects of both number of business segments followed by an analyst and analyst industry diversification on individual analyst earnings forecast accuracy applies a new measure of an analyst's diversification. The measure uses a combination of the number of two-digit SIC code business segments reported by the company and the number of two-digit SIC code business segments followed by the individual analyst to calculate an analyst's diversification measure for each analyst-company combination. The analysis indicates that as an analyst follows more business segments and a greater diversification of industry, his earnings forecasts are significantly less accurate. These results have implications for researchers who use analyst earnings forecasts in studies; investors who use forecasts for company valuation; and brokerage firms in evaluating individual analysts and assigning analysts to companies. %U https://joi.pm-research.com/content/iijinvest/14/2/7.full.pdf